Proposal to delay the time of applying special consumption tax on alcohol and beer

“Cherish” growth opportunities

Speaking at the Workshop on Supporting Economic Growth: Perspectives from Enterprises Subject to Special Consumption Tax organized by Nhan Dan Newspaper on the afternoon of April 22, Mr. Le Quoc Minh, Member of the Party Central Committee, Editor-in-Chief of Nhan Dan Newspaper, Chairman of the Vietnam Journalists Association said: In the first quarter of 2025, Vietnam achieved a GDP growth rate of 6.93%, the highest in the first quarter in the period 2020 - 2025.

'However, this growth rate has not yet reached the target as set out in the operating scenario that has been adjusted by the Government to suit the new situation of the country, towards the aspiration of becoming a prosperous nation by 2045' - Mr. Le Quoc Minh informed.

Mr. Le Quoc Minh, member of the Party Central Committee, Editor-in-Chief of Nhan Dan Newspaper, Chairman of the Vietnam Journalists Association spoke at the conference. Photo: NH

According to Mr. Le Quoc Minh, the current world situation continues to have complex and unpredictable developments, escalating trade tensions can cause disruptions in the production and supply chains of many economies around the world.

Domestically, the business community is still facing many prolonged difficulties since the COVID-19 pandemic, reflected in the number of bankrupt and temporarily suspended businesses at times being higher than the number of newly established and re-entering businesses.

'In that context, the goal of striving for GDP growth of 8% or more, creating a solid foundation for double-digit growth in the following years, becomes even more challenging' - Editor-in-Chief of Nhan Dan Newspaper affirmed.

Speaking at the workshop, economic experts said that 2025 is of special importance, being the final year of implementing the 5-year Socio-Economic Development Plan 2021-2025, and at the same time the year focusing on organizing Party Congresses at all levels, towards the 14th National Party Congress.

To achieve the growth target in 2025, as a premise for the growth target in the period of 2026 - 2030, economic expert, Dr. Le Duy Binh - CEO of Economica Vietnam said: Vietnam needs to "cherish" economic growth opportunities, in order to achieve the set goals.

In fact, to create growth opportunities in 2025, the Government has recently introduced many solutions to support the business sector such as reducing value-added tax (VAT), reducing land rent, and aiming to cut 30% of administrative procedures to facilitate business operations.

However, the Draft Law on Special Consumption Tax (SCT) amended by the Ministry of Finance, expected to be submitted to the National Assembly for consideration and approval at the 9th session of the 15th National Assembly in May 2025, proposes to increase the SCT rate on beer from the current level of 65% according to 2 options.

In which, option 1 increases from 2026 with an annual increase of 5% until 2030 up to 90% and option 2, increases tax from 2026 with a rate of 15%, then from 2027 increases each year by 5% until 2030 the special consumption tax rate for beer is 100%.

According to economic expert Le Duy Binh, in addition to affecting a number of other industries, the revised Law on Special Consumption Tax, if applied, will have a large and direct impact on the production and business activities of enterprises in the industry, millions of workers in the industry and related industries, millions of consumers and the economy.

Experts recommend extending the implementation roadmap of the revised Law on Special Consumption Tax to avoid causing shock to businesses. Photo: NH

Need a reasonable roadmap and avoid "shocking" businesses

In the context of the world economy changing rapidly and abnormally, affecting the production and business activities of enterprises. Meanwhile, with the political determination of the 8% growth target as well as the spirit of supporting enterprises and people, economic experts have proposed to consider postponing the effective date of the Law on Special Consumption Tax.

Specifically, according to economic expert Can Van Luc, the time to apply the increase in special consumption tax on beer and alcohol should be postponed until January 1, 2028. And the increase should be more gradual to help businesses have time to prepare and adapt, and also to contribute to promoting high growth.

Mr. Can Van Luc also recommended: 'It is necessary to calculate a suitable roadmap for increasing special consumption tax, avoiding causing "shock" to businesses and the market. In particular, consider applying different tax rates according to alcohol concentration and sugar content, avoiding equalization, for example, the higher the concentration, the higher the tax rate will be'.

Sharing the same view, economic expert Le Duy Binh also said: Faced with the difficulties that businesses, especially private businesses, needing to ease the burden on people and businesses, and nurturing revenue sources should be considered a priority choice in policy making, and this is the best and most effective way to support businesses and the economy.

Sharing the same view, Ms. Phan Minh Thuy, Head of the Legal Department of the Vietnam Federation of Commerce and Industry (VCCI) said that in the context of businesses being under a lot of pressure due to global economic fluctuations, increasing special consumption tax on items such as alcohol and beer needs to be carefully considered.

Accordingly, the tax increase roadmap should be designed reasonably and moderately, not shocking the market and creating conditions for businesses to adapt. For beer, VCCI proposed to increase tax from 2028, with a 5% increase every 2 years until 2030.

Speaking at the workshop, Mr. Luu Duc Huy - Deputy Director of the Department of Tax, Fee and Charge Policy Management and Supervision (Ministry of Finance) said: The Ministry of Finance is the agency assigned to develop the revised Law on Special Consumption Tax, and during the development process, it has closely followed the tax reform strategy approved by the Prime Minister. In particular, the goal of increasing special consumption tax on beer and alcohol is not to increase budget revenue but to protect the health of consumers.

According to Mr. Luu Duc Huy, the revised Law on Special Consumption Tax is really necessary and has been submitted by the Government to the National Assembly for consideration at the 8th session in 2024. However, the world economic situation is changing a lot, the corresponding tax policy has strongly affected production and business activities and the psychology of enterprises. On that basis, the Government has also directed, the Ministry of Finance has researched and reported to the Government to consider a number of issues on the Draft Revised Law on Special Consumption Tax.

The Government has taken a vote of members to adjust the plan of the Law on Special Consumption Tax so that the Ministry of Finance can help the Government agencies give opinions to the National Assembly's Economic and Financial Committee on the necessary content to adjust the plan.

After receiving the Government's approval, the Ministry of Finance sent a document to the National Assembly's Economic and Financial Committee with a number of contents: First, to extend the roadmap for increasing special consumption tax on items in the draft law, including beer and alcohol. Previously, the Government submitted to the National Assembly the tax increase plan as plan 2, but now to "reduce the shock", the Government proposes to implement according to plan 1 as previously submitted.

Second , it is possible to extend the implementation schedule from 2026, and implement it from 2027.

According to Mr. Luu Duc Huy, the Economic and Financial Committee will synthesize the opinions of the Ministry of Finance, report to the National Assembly Standing Committee for a plan to include in the draft Law on Special Consumption Tax, and submit it to the National Assembly for consideration and approval at the next session.

The draft Law on Special Consumption Tax is being amended to increase the special consumption tax rate on beer (current tax rate is 65%) with 2 proposed options, including:

Option 1: Increase tax from 2026, increase annually and increase by 5% each year so that by 2030 the special consumption tax rate on beer is 90%.

Option 2: Increase tax from 2026 by 15%, then from 2027 increase by 5% each year until the special consumption tax rate on beer is 100% by 2030.

Nguyen Hoa

Source: https://congthuong.vn/de-xuat-lui-thoi-gian-ap-thue-tieu-thu-dac-biet-voi-ruou-bia-384395.html